More planes on the market?

[Squeegee Longtail]

Is it me or are there a lot more complex/high performance singles coming onto the market recently both in UK and US? I am looking for one and seem spoilt for choice compared to a few years ago. Could it be fuel price biting already? Credit crunch? imminent restrictive GA "terrorist" legislation? just my imagination?

[IO540]

I think it is partly your imagination, and partly Cirrus and Diamond having entered the market during the last 6 years or so, and sold in noticeable numbers.

[Fournier Boy]

I have seen a Harvard down to £55k, i know its been for sale for a while, but that has got to be a result of fuel prices!

FB

[flybymike]

My personal perception is of more aircraft available at lower prices. A definite market downturn.

[englishal]

plus the credit crunch in the USA especially. Now is the time to buy if you have the dollars available! You can pick up a decent PA28 Dakota for £30,000 in the USA at the moment.....

Anyone want to go splits and import a couple ;)

[IO540]

On the basis that the OP was referring to secondhand planes......

There are more about of those too. Prices of IFR tourers especially have bombed, partly due to Cirrus having sold a few thousand of them and many of those have been placed in the market soon afterwards. Something has to give somewhere.

One would think that a lot of people would be selling IFR tourers in today's fuel prices but those I know are not selling due to that reason; fuel is only a part of the total operating cost.

[Rod1]

“fuel is only a part of the total operating cost.”

With fuel hitting £1.80 your “average” IFR tourer is going to be costing £7000 ish for 100 hours a year. This would be the dominant cost in running such an aircraft and is up very significantly on recent years. Second hand values of aircraft of 180hp plus have come down significantly, but the vintage machines with smaller engines seem unaffected.

Rod1

[Fuji Abound]

There is an interesting lead article in Flying this month by Mac McClellan.

The article considers whether the aircraft price bubble has burst, after a very long run of prices rising at a rate disproportionate to the market.

Mac concludes a number of factors are at work in the States at least.

Firstly, Cirrus, Cessna and others have introduced a degree of innovation into light singles (and twins in the case of 42s) not seen in years. Who doesn’t want a glass cockpit or a smart interior these days. These aircraft have also been produced in volume. Whilst the new price may have been beyond the scope of most, the market is now becoming saturated with good second hand aircraft. I recall in the racing dinghy market of all things exactly the same thing happened when a company called Topper launched the Iso many years ago. It was the first new dinghy design in years. They sold a vast number at premium prices. Some years later as many good second hand examples became available and a number of other manufacturers were closing in on the market prices collapsed - including I might add the new price.

Secondly, anyone who didn’t want a Cirrus, Cessna etc realised that many very capable aircraft, singles and particularly nearly every twin, had been out of manufacture for many years. However, it also dawned on people that it was possible to "upgrade" these aircraft with new panels and interiors. I am not convinced this has been going on in the UK to a great extent, but it certainly has in the States.

Thirdly, there can be do doubt that rising fuel prices and the cost of just about everything else connected with aircraft ownership is a factor. As the economy tightens you might expect maintenance organisations trying to hold their charge out rates, but I think we will see pressure on wages which inevitably has to be passed on to the customer. Anyone with a Diamond will already be smarting from the price hikes occasioned by Thielert, and anyone else owning a aircraft manufactured in Europe will be smarting from a strong Euro. The dollar on the other hand has gone down the plug hole, at least making parts from the other side of the Pond cheap - we should be grateful for small mercies.

However, Mac interestingly concludes the downturn in the pilot community is the more significant factor. I was surprised to read that in 1984 their were 840,000 active pilots in the US, there are now less than 600,000 (and that includes commercial pilots as well).

I suspect this is also a significant factor here. Moreover it will become even more significant. I suspect schools are having a very hard time. Ab initio training is suffering - badly. There are many long time pilot who are looking wistfully at the significantly lower operating costs of PFA type aircraft. Many pilots I know are simply giving up or flying significantly less. Of course with lower hours flown pilots are already on the slippery slop of finding their confidence deteriorates to the point at which eventually it is easier to give up completely.

Where I fly there are limitations on the number of movements a year. Although the limits are generous I recall not that many years ago the Authority being concerned to the extent that they were pleased with the odd IFR day to bring the average numbers back under the red line. Now days they are praying for CAVOK 365 days of the year. Unfortunately even with global warming I don’t think their prayers are being answered as we suffer yet another early summer which hasn’t quite owned up to what it says on the tin.

Dick Karl in the same edition writes about the temptation he had recently to sell his Cheyenne. I know, I know a Cheyenne is hardly representative of the light single piston market. However, that is not the point. Karl has flown his Cheyenne for as long as I can remember looking forward to reading his accounts in Flying. He is a well to do surgeon in a country where they know the value of the knife. You can be sure that if he is hurting over the costs, so are most of us both sides of the Pond.

I am sorry to be a pessimist but it is not your imagination. The market is weak - very weak. In fact it might even be at the point of a serious collapse. You can expect some very good bargains. Possibly the single saving grace so far as the UK is concerned is some in Europe are waking up to how cheap aircraft are here if you are paying in Euros compared with nine months ago but there again add 10K for the ferry and you can buy from the States even more favourably.

I have no idea if it will recover. I would like to believe it will - but who will bet on fuel prices falling significantly in the foreseeable future. Unlike aircraft, when prices go up, they rarely return to the point at which they started.

However, I think Mac is probably right. The real problem is the falling active pilot population. The economics are not complicated - if you have two pilots that both want to buy an aircraft and only one aircraft is for sale the price is sure going to rise, but if you have ten aircraft for sale and only one pilot in the market you had better expect to get a whole lot less for the aircraft than you paid.

[IO540]

All very good points, Fuji.

When I bought the TB20 in 2002 it was £200k. A year later it was listed at £239k - a bizzare price increase. Something had to go - it was obvious even to me back then that the manufacturers were taking the micky.

Yet these price increases ran for many years. If you bought say a Cesspit in say 1970, you could have sold it during any year before about 2003 for at least the original purchase price - because the price of new ones was going up so fast. (Of course this is really so because of the huge wads you spent each of those years keeping it airworthy...)

For the TB20, fuel is slightly under half the total operating cost, based on 150+ hrs/year and flying at 11GPH. Obviously it is significant but one did not acquire long range IFR / airways capability to save money :)

[VictorGolf]

Spoke to a school operating "petrol" twins and they said that every 3p/litre increase in fuel costs them £11000 per annum. That's about half a salary if you care to look at it that way. It also means a twin is virtually uinsaleable these days in the private market.

[IO540]

Spoke to a school operating "petrol" twins and they said that every 3p/litre increase in fuel costs them £11000 per annum. That's about half a salary if you care to look at it that way. But think of how many hours they must be flying if 3p/litre costs them £11k/year. Their annual avgas bill must be about £600k, which is about 3500 hours if they operate Senecas. That means about £2M/year billing just on twin piston training. Not a bad business! I wonder how many planes they do that over. Perhaps half a dozen, in which case they are doing pretty well out of it.

It also means a twin is virtually unsaleable these days in the private market.They do sell but for some years they have been selling for more or less just the remaining time on the engines.

The sort of people who buy old piston twins (and most piston twins are old) are either people who don't mind flying an old dog and have allowed for the eye watering maintenance costs, or people who are going to turn it into a "project aircraft" and they refurbish it at a huge expense and they end up with a very mission-capable machine.

I don't think the bottom will ever drop out of the IFR tourer market because plenty of people can afford to play in that arena. Look at Cirrus sales - all avgas tourers.

[Squeegee Longtail]

Surely with significantly decreasing pilot numbers, as stated, the GA community will become more prone to the anti GA lobby (see todays article p 16/17 Daily Mail). Also fewer ppls using GA facilities means costs of facilities etc shared between less people (ie higher costs), therefore driving more pilots out, therefore becoming more expensive - see a spiral dive starting?
Legislation could be the final killer though, as the representative lobbies fighting our corner become representative of less people and therefore less powerful.

Someone give me some good news!!

[IO540]

There isn't much good news in this game, ever, but one needs to see the whole picture, which is that GA has always had a massive attrition rate. The vast majority of the people who get a PPL are not flying anymore (ever) a year or two later.

So the # of active pilots is a small difference between two large numbers, which means it is very sensitive to a lot of factors.

A lot of people have plenty of money and will always be flying.

[Squeegee Longtail]

"A lot of people have plenty of money and will always be flying"

....not if GA gets outlawed (see the terrorist threat thread). GA has only ever been "tolerated" as a rich man's hobby.

But we have gone completely off topic, so let's wrap it up.:)

[A and C]

GA won't be outlawed simply because we have a lot of rich people with infulence in the GA community.

Remember "Money talks!"

[englishal]

I would buy an Avgas IFR SEP tourer but would not buy an Avgas MEP tourer.....Fuel at 15 gals per hour is achievable compared to the rest of the costs if you can cruise at 160-175 kts, but when you start to reach 30 gals+ per hour then is suddenly becomes a huge cost with not much advantage.

[flybymike]

Unless one of the engines stops, which may or may not be a disadvantage dependent upon your skill and a few other variables....;)

Anyway, I can think of a few twins which burn less on two engines than my 18 gallon an hour IFR SEP.

[IO540]

I can think of a few twins which burn less on two engines than my 18 gallon an hour IFR SEP.

The DA42 does (11GPH combined at 140kt IAS) but when the engine packs up (which they do fairly often) you are grounded for an awfully long time ....

What kind of an IFR SEP do you have that burns 18GPH? I know the Cirrus SR22 and the Lancairs do, to achieve the sales brochure TAS figures, but that is at 75-85% power which is an awful lot; one should not cruise at such power settings because the motor is unlikely to make TBO.

I agree with Englishal re 30GPH+. This gets pretty poor value for money. Mind you, one can take the legitimate view that you bought the plane so cheap that blowing money away on fuel is still worth doing. Such planes are great for the "VFR in all weather" kind of flying which a lot of the owners do in them, to avoid the Eurocontrol route charges. An Aztec can fly with inches of ice on it.

[flybymike]

Cessna turbo 206 at 75% in the climb = 20galls per hour.

Leaned off in the cruise = 18 galls per hour.

75% cruise recommended for first 50 hours following engine rebuild, after which time reverting to an "economical" 60% at a mere 14 galls per hour is called for!

And apart from the DA42 there are still some twins which will do even 14 galls an hour all in. ;)

[Rod1]

What about the new Tecnam? An IFR Twin on 7GPH.

Rod1